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Unformatted text preview: Q* = 100 – 80 = 20 Man. Profits = (60 - 20)*Q = 40*20 = 800 Retail Profits = (P - W)*Q = (80 - 60)*20 = 400 What if the Manufacturer charges a Two-Part tariff? 1. Compute how the Retailer will respond to the Manufacturer’s offer 2. Then compute the Manufacturer and Retail profits Discussion of Channels-when you sell to a retailer, there will be issues with managing the image of your brand-way to feature your product may dilute your brand image (ex: Lexus commercial vs. Lexus dealership commercial)-by changing a product line (making things exclusive) you can give retailers more power...
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This note was uploaded on 12/11/2011 for the course MKT 300 taught by Professor Barnes during the Fall '08 term at Wisconsin.
- Fall '08